The Department of Housing and Urban Development has announced policy updates and changes that have been added to the FHA Single Family Home Loan Program Handbook, HUD 4000.1.
According to an FHA/HUD press release, these are the first changes and updates to the handbook since late 2016.
“With today’s update, FHA is recommitting to the industry that it will continue to maintain and enhance the SF Handbook so that it becomes a single, comprehensive source of policy guidance for lenders and other stakeholders doing single family business with FHA” according to the press release.
The updates, posted March 27, 2019, include a set of “technical changes for consistency and clarity” as well as FHA home loan program policy updates.
These updates affect how the lender may handle certain issues associated with FHA mortgages; the press release says that “changes identified in the Transmittal do not affect previously announced effective dates and are effective immediately”.
The FHA and HUD have gone on the record to commit to “regular quarterly (HUD 4000.1 Handbook) updates. Changes, revisions and updates to Home Equity Conversion Mortgage (HECM), Title I, and Condominium Approval sections of HUD 4000.1, referred to in the press release as the “SF Handbook” are in the development stages at the time of this writing according to the HUD official site.
The changes made to HUD 4000.1 range from simple corrections or replacements of nomenclature to distinct changes in policy with regard to how defaulted mortgages are handled, certain assessments related to clean energy, and much more.
We will address these changes in the coming months depending on the nature and impact of the updated regulations.
Some of those changes include alterations to the FHA loan rules governing how many FHA home loans a borrower can have (those who own homes purchased with FHA loans are now officially and specficially permitted under FHA loan rules to be a non-occupying co-borrower on another transaction), and also updates to the rules governing “free assumability” of a property purchase with an FHA mortgage.
If you aren’t sure how FHA home loan updates affect your transaction, or a future home loan transaction including refinances, reverse mortgages, or rehab loans, speak to a participating FHA lender.